The launch of the first Amazon Go store in December is the sign of a continued evolution of omni-channel payment experiences that began with the launch of the first eCommerce stores back in the mid-to late nineties. To me, this is the the final realization of a brand’s promise to allow a consumer to engage in an experience wherever and however they want.
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The First Era: Two solitudes.
The first generation of bricks and mortar retail and e-commerce was that they were competing and battling for the consumer experience, even if both channels existed under the same brand. There was no interaction between the two and consumers had to choose whether to have a digital or store experience.
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The Second Era:
The rise of digital retailing. The first steps towards an omni-channel experience has come with bricks and mortar retailers introducing innovations in their store that enhance the in-store experience, and keep their relevance in an increasingly digital world. This includes Interactive experiences (video walls and shoppable glass), Location based analytics and beacons and payment innovations such as tap to pay, and pay before (click and collect).
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The Third Era:
The rise of the retailing digital brand. I believe we have now entered a third era in omni channel, one where digital retail brands are now realizing the untapped potential of a retail presence. And for good reasons:
- Retail environments provide new experiences for the consumer to interact with a brand and build trust
- They provide additional marketing opportunities that can be highly localized and tactile.
- They provide access to consumer segments once considered unreachable.
Our company, Payment Source is highly focused on this third era of providing innovative retail experience for digital brands. Specifically, we launched Loadhub, an in-person payment solution that allows digital brands to provide an in-person experience for purchase of their products or services. This gives these brands the ability to attract and serve customers who do not have access to credit cards, prefer cash or have cyber security concerns around sharing their financial information online.
Many brands underestimate the power of this capability and it's not immediately intuitive. When we launched a customized Prepaid Visa program at Canada Post, we gave consumers the choice to reload their card online through a bank transfer or in-person at Canada Post. Overwhelmingly (and much to our own surprise), 92% of consumers chose to reload their card in person at Canada Post using cash or debit. This program is now one of the most successful prepaid programs in Canada.
A recent survey by the CPPO by the CPPO supports this need. Of the 92% of Canadians who have credit cards:
- 31% do not want to have it
- 26% have a running balance
- 40% have credit card debt.
Clearly, consumers want an alternative to credit cards. Even debit solutions are not enough. The same study indicates that 66% of Canadians are concerned with the security of their credit and debit cards for online purchases. This makes sense considering banks have been training consumers for the last 20 years to protect and guard their PIN. Getting people comfortable with now putting this PIN into a website will take time.
Beyond Amazon, many other digital brands are starting to realize the value of retail. PayPal’s recent acquisition of Tio Networks, is one example. Tio is a Bill Payment Network that allows US consumers to pay their bills at over 65,000 retail networks across the US. According to their press release, the acquisition is “aligned with our mission to expand access and participation in the financial system for those who have been underserved”.
With solutions such as Loadhub and other innovations appearing in the market, it is a sign that Omni-channel has truly come of age.
Rob Hyde VP Business Development Rob works out of Payment Source’s Toronto office and is a technology and fintech enthusiast.